Terminating your lease agreement

Private Property South Africa

Property Power •
Sep 15, 2015

There are many reasons which could lead to a tenant needing to terminate their lease prematurely, for example being transferred to work in another city or a couple breaking up and leaving the remaining tenant unable to afford the rent on their own. Depending on the cancellation clause in your lease agreement, terminating your contact prematurely may not be that easy. If a cancellation clause does not exist in your lease, ending your lease may be considered a breach of contract. This means that your landlord is within his rights to demand that you still pay the rent due for the balance of your lease period and you may also lose your deposit.

Under what circumstances would I be able to cancel my lease without being in breach of contract?

If your landlord is in material breach of the lease, then cancelling your lease early will not be in breach of the contract. An example of this would be a situation where the landlord has not maintained aspects of the property that were agreed upon in the lease and you are left with no choice but to leave, due to the property becoming uninhabitable. However, if this situation does arise, it will be necessary for you to prove that this is in fact the case and that the landlord is definitely in breach of contract.

What if my landlord has met all the conditions of the lease, can I still end the lease early?

If your landlord has met all the conditions of the lease and you decide to cancel your lease early, you will be in breach of contract unless the termination of the lease has been mutually agreed upon. Speak to your landlord before making any rushed decisions, chances are, you may be able to come to a mutual agreement whereby you are able to find a replacement tenant or sublet the property for the remainder of your lease. There is currently a shortage of rental properties in South Africa – so the odds should be in your favour when looking for a tenant to take over your lease.

Be sure to get any agreement that you have made with your landlord in writing and make sure all terms and conditions of your agreement are included in this document to prevent any misunderstandings down the line.

What can I do if my landlord refuses to come to an agreement?

Under the Consumer Protection Act (CPA) tenants are able to give landlords 20 days’ notice if they want to cancel their lease before it expires. This clause does not, however, guarantee you a clean-cut escape. A tenant has every right to move, sometimes this situation cannot be helped (due, for example, to a transfer in job to another city) however, one needs to remember that a landlord who has met all the conditions of the lease is also within his right to recoup any reasonable costs that he might incur whilst searching for a replacement tenant. Loss of rental income, commissions paid to letting agents, as well as the cost of advertising the property, are just some of the costs that you may be liable to refund your landlord under these circumstances.

Having said this, your landlord is not free to just make up exorbitant figures, just because he feels that it is owed to him. It is also illegal for a landlord to withhold the entire deposit amount, even if a new tenant has not yet been found. (Please keep in mind that damages to the property are billed separately from the CPA amount. Thus, the tenant will be liable for these repair costs, over and above the cancellation costs.) The CPA does not stipulate what a reasonable figure would be, so it will be in your best interest to consult a property attorney when negotiating the termination of your lease.

Please note: If the tenant is able to find a replacement tenant, the landlord is not allowed to turn the prospective tenant away in favour of making the tenant pay penalties for ending their lease early. The landlord is also not entitled to charge penalty fees once a new tenant has been found. If this situation does occur, the tenant has every right to lay a complaint with the Rental Housing Tribunal.

My lease expired months ago, do I need to give notice before I move out?

This depends on the terms of your lease agreement. If there is a renewal clause included in your lease, this will specify how much notice you are required to give your landlord before you move.

If there is no renewal clause in the lease agreement then, through your actions, you have effectively already entered into another lease period of the same length, with the same terms and conditions that were specified in your previous lease agreement. In this case, you would then need to check for a cancellation clause in the original lease in order to terminate the lease agreement.

If your original lease does not have either a renewal or cancellation clause, you will need to follow the same procedure as if you were prematurely terminating your lease agreement as explained above. Without a cancellation clause, you would need to give your landlord one month’s notice, in writing, before the lease expired (e.g. in the 11th month of a 12 month contract) in order to end the contract.

This article originally appeared in Property Power 11th Edition Magazine.
To order your copy at the discounted price of R120 click here.

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